Which of the Following Are Characteristics of a Liquid Asset

question 53

Multiple Choice

Which of the following are characteristics of a liquid asset?

• A)The asset can be turned into cash quickly.
• B)Turning the asset into cash will result in low transaction costs.
• C)Turning the asset into cash will result in little or no loss in principal value.
• D)All of the listed options are correct.

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Definitions:

Semiannually

Occurring twice a year; used to describe the frequency with which certain financial or operational events take place, such as interest payments on bonds.

Equity Method

An accounting technique used to record an investor's proportional share of the net income and losses of an investee company in which the investor has significant influence but not full control.

Year-End Adjustment

Journal entries made at the end of an accounting period to account for incomes and expenditures in the correct accounting period.

Lower Of Cost

Refers to the accounting principle of valuing and reporting assets at the lower of its historical cost or the market value.